Cash Digitisation in Emerging Markets: Empowering Financial Inclusion through Automated Cash-in/Cash-out (CiCo) Infrastructure | Loop


September 13, 2023·4min read

The financial landscape in emerging markets is evolving rapidly, driven by the adoption of mobile-based financial services. What initially began with telecom giants like Vodafone (Mpesa) and Airtel (Airtel Money) has swiftly become the primary avenue for financial inclusion, especially in regions like Africa.
At the core of this transformation are the human agents, also known as Cash-in/Cash-Out (CiCo) network agents. These agents serve a dual purpose: enabling cash deposits and withdrawals, allowing customers to top up their mobile wallets and withdraw funds as needed.


Understanding CiCo Systems

Cash-in/Cash-Out (CiCo) systems represent the backbone of financial transactions in emerging markets, where physical cash still plays a dominant role. These systems serve as the bridge that connects traditional cash-based economies with the ever-expanding realm of digital financial services.


The Core Functionality

At its core, CiCo systems are designed to provide individuals and businesses with a mechanism to seamlessly transition between cash and digital money. They encompass a network of access points, which can include human agents, ATMs, and bank branches, strategically placed to facilitate the conversion of cash into digital currency and vice versa.


Enabling Financial Inclusion

The significance of CiCo systems lies in their ability to empower financial inclusion. They cater to individuals who rely on physical cash for daily transactions by allowing them to access and leverage digital financial services. This inclusivity is crucial in regions where cash remains prevalent.


Coexistence with Digital

Interestingly, CiCo systems don’t signify the eradication of cash. Instead, they foster coexistence. Even as digital transactions surge, the demand for cash remains robust in many countries. This juxtaposition showcases the symbiotic relationship between digital and cash transactions.


Role in Transition

CiCo systems don’t merely facilitate transactions; they play a pivotal role in transitioning economies from cash-based to fully digital systems. They act as vital enablers, ensuring that the shift to digital doesn’t disrupt the financial routines of individuals and businesses.


The Functions of CiCo Agents

Agents perform two pivotal roles: facilitating cash transactions for customers and providing essential “float” liquidity on the backend. In the case of Cash In, where customers deposit cash, agents need to provide a float upfront, which is then digitally dispensed to the customer.
To incentivise this process, agents receive substantial commissions on both Cash In and Cash Out transactions from mobile money networks. These commissions often represent the most significant operational cost in running a mobile money network since they are linked to the agent’s cost of capital, which can be notably high.


The Symbiotic Relationship

This mechanism hinges on the availability of a digital float, ensuring that customers can convert cash into digital money effortlessly. This, not only enhances customer experience but also drives the widespread adoption of digital financial services. Furthermore, it bolsters the resilience of financial ecosystems in emerging markets, making them more adaptable and better prepared for digital transitions.


The Coexistence of Digital and Cash

While digital financial services offer numerous benefits, such as convenience, security, and efficiency, the reality is that the coexistence of digital payments and cash is prevalent in many countries worldwide.


Insights from Global Data

A closer look at global data reveals a fascinating trend: even as digital transactions surged, the demand for cash remained robust. This highlights the symbiotic relationship between digital and cash transactions. They don’t just coexist; they thrive together.


CiCo Infrastructure Growth

This nonlinear relationship between cash-handling infrastructure, including agents, ATMs, and bank branches, and the adoption of digital financial services is an intriguing one.


CiCo’s Role in Developing Financial Markets

The underlying principle is clear: as digital financial products gradually digitise various financial transactions, CICO points become instrumental in encouraging more people to use these services.


The Transition to a Digital Economy

In essence, the full transition to a digital economy only occurs when most income and expense-related transactions are digitised, significantly reducing the need for physical cash.


The Crucial Pace of Transition

The pace of this transition determines how quickly a country can move away from a cash-intensive economy and embrace a fully digital financial system.


CICO Network: Cornerstones of Expansion

This process underscores the indispensable role played by convenient, reliable, and trustworthy CICO networks in expanding and deepening digital financial services in developing financial markets.


The Bridge to Financial Inclusion

As financial ecosystems evolve, CICO network points serve as gateways for new customers to enter the digital financial landscape, ultimately contributing to broader financial inclusion and a more resilient financial ecosystem.



As emerging markets strive towards greater financial inclusion, the role of automated cash-in/cash-out (CiCo) network can’t be understated. It’s the bridge that connects traditional cash transactions to the digital financial world, empowering individuals and businesses alike. By leveraging cash deposit machines, automated cash handling, and real-time cash collections, we can create secure and efficient cash digitisation solutions that lay the foundation for a more financially inclusive future.

In this journey towards digitisation, Loop stands as a reliable partner, bringing innovative cash management machines to businesses and helping them navigate the transition from physical cash to digital solutions. Loop’s cash deposit machines offer convenience, efficiency, and security in handling bulk cash deposits and collections, making them an essential tool for modern financial ecosystems.

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